September 4, 2007
WALTHAM, Mass. – Spectra Energy, capitalizing on its existing footprint in the Northeast natural gas market, plans to invest about $1.5 billion – or half of its $3 billion in projected capital expenditures over the next three years – in cost-effective expansions that will bring incremental natural gas supplies to the growing New England, New York and New Jersey markets.
As new supplies enter the region this November and new infrastructure is placed into service, the region will have unparalleled access to significant sources of Eastern U.S. seaboard liquefied natural gas (LNG) and Western U.S. natural gas.
“We’re connecting supply from all compass points and moving it to the Northeast region,” said Fred Fowler, Spectra Energy president and CEO. “These are real projects that offer customers supply choice and reliability, and will bring competitive pricing to the region.”
Spectra Energy has worked with LNG developers for the last several years to advance projects to provide the growing Northeast market with access to new diverse sources of both domestic and international supply options.
A significant advancement in increasing supply access to the market is the company’s proposed East-to-West Project, an expansion of the company’s Algonquin pipeline system that will bring more than 1 billion cubic feet per day (Bcf/d) of eastern LNG-based supplies into Northeast markets.
Spectra Energy has executed binding agreements with suppliers and Local Distribution Companies and has initiated the Federal Energy Regulatory Commission approval process.
The East-to-West Project will allow Algonquin to reverse flow on its system to transport critical LNG supplies from the Eastern seaboard to the New England and Northeast markets and will transform traditional gas flow in the Northeast. In addition to the high growth markets on Algonquin, these new supplies will be able to access additional markets through existing interconnects with Spectra Energy’s Texas Eastern Pipeline and Maritimes & Northeast Pipeline, as well as four other market area interstate pipelines.
The project, which will utilize existing infrastructure combined with new pipeline and compression, is expected to be in service by Nov. 1, 2009.
With the demand for gas consumption in the Northeast and mid-Atlantic region expected to grow by approximately 25 percent to more than 13 Bcf/d by 2015, Spectra Energy is currently constructing additional pipeline and storage expansions in the region as part of its continuous Northeast strategy to provide right-sized and well-timed projects to the market.
Northeast pipeline expansion projects currently under construction include the Texas Eastern Incremental Market Expansion (TIME) II Project; Algonquin Northeast Gateway Project, Algonquin Cape Cod Extension, Algonquin Ramapo Expansion and Maritimes & Northeast Pipeline Phase IV Expansion Project where Spectra Energy serves as the lead partner.
In addition, Spectra Energy has several additional northeast projects in advanced stages of development including the Steckman Ridge storage project, a joint venture between Spectra Energy and New Jersey Resources.
Last year, Spectra Energy also recognized the potential for Rocky Mountain natural gas to move further east on its Texas Eastern pipeline system and held a successful open season for a proposed “TEMAX” project.
As a result of conversations with potential shippers, Spectra Energy is commencing an open season Thursday, September 6, for incremental pipeline capacity from Clarington, Ohio, to the Oakford, Pa., area.
Named “Northern Bridge,” this right-sized expansion of the existing Texas Eastern infrastructure will allow producers access to several more interstate pipeline and storage options that the Oakford area affords, and makes Rocky Mountain supply a viable and timely alternative for Northeast markets.
The exact nature of the facilities will be determined by the results of the open season. The capacity is expected to be 200 million to 500 million cubic feet per day (MMcf/d) with an anticipated capital expenditure of $100 million to $150 million. The project is expected to be in service in late 2009. The company also plans to explore the need for incremental pipeline capacity from Oakford to the Northeast markets.
Spectra Energy Corp (NYSE: SE) is one of North America’s premier natural gas infrastructure companies serving three key links in the natural gas value chain: gathering and processing, transmission and storage and distribution. For close to a century, Spectra Energy and its predecessor companies have developed critically important pipelines and related energy infrastructure connecting natural gas supply sources to premium markets. Based in Houston, Texas, the company operates in the United States and Canada approximately 17,500 miles of transmission pipeline, 265 billion cubic feet of storage, natural gas gathering and processing, natural gas liquids operations and local distribution assets. Spectra Energy Corp also has a 50 percent ownership in DCP Midstream, one of the largest natural gas gatherers and processors in the United States. Visit www.spectraenergy.com for more information.
This release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements represent our intentions, plans, expectations, assumptions and beliefs about future events. This release includes forward-looking statements concerning future developments at our facilities, including the anticipated timing and amount of planned capital expansions and anticipated future natural gas pipeline capacity as well as the demand for such capacity. Such statements are subject to risks, uncertainties and other factors, many of which are outside our control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. Those factors include: the timing and success of efforts to develop infrastructure projects; the timing and receipt of required regulatory approvals; the timing and receipt of sufficient capacity commitments for the described project; and fluctuations in the demand for natural gas in the markets serviced by the described project. These factors, as well as additional factors that could affect our forward-looking statements, are described in our Form 10-K, filed with the Securities and Exchange Commission on April 2, 2007, and other filings that we make with the SEC, which are available at the SEC’s website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than we have described. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.John Sheridan